Pay-for-Performance and Drug Pricing: Impact and Response of Pharma 
The pay for performance agenda gathers pace as US payers rebel the cost of drugs.
Pharma is in the firing lineas fundamental change sweeps across the US health delivery sector. Driven by unsustainable growth in drug costs, health payers want therapies that prove to deliver better patient outcomes at a lower cost. Under mounting pressure, what can Pharma do to ensure positive payer support for its pricing proposals?
Pay-for-Performance and Drug Pricing Pressure: Impact and Response from Pharma intensively examines the drivers and the players involved through informed opinion, detailed secondary research and instructive case studies.
“Long term, what may have to happen is that government may have to step in. Whether it's Medicare or Medicaid, each may have to negotiate a better pricing option.” US Payer
Answering key questions:
Firmly on the public payer’s agenda: Will Accountable Care Organisations (ACO) and the Medicare Shared Savings Programme embrace drug prices?
Private insurers move: Private insurers are encouraging patient choice and rewarding clinicians prescribe specific therapeutics over others. How can Pharma ensure formulary preference?
A panacea? Will pay-for-performance strategies, such as paying for the value per indication given for drugs that have multiple indications, ever be viable?
Clinical evidence: How can late stage and Phase IV clinical trials be designed to demonstrate value over existing therapies?
Non clinical assessment: How might less traditional clinical endpoints demonstrate value and support pricing?
Co Pay or No pay? The battle between manufacturers and payers grows as strategies become more confrontational. Why are patient support programmes not universally seen as positive?
Hepatitis C lessons: What lessons can the wider industry take from Gilead’s and Abbvie’s experience in the fast-moving HCV market?
With this report you will be able to:
Understand the drivers that underpin payer and public concerns and which are setting the pay-for-performance vs pricing status quo agenda
Understand how public payers are reforming health delivery and assess the likely impact on pharma as these initiatives mature.
Examine how private health insurers are leveraging competitive pressure, reward schemes and limiting formulary access to control their costs and negotiate better deals
Appreciate how clinical trials must confirm safety, efficacy but also demonstrate value if the product is going to find a position in the market
Learn about leading companies such as Gilead, J&J, Novartis, Sanofi, Roche, Eli Lilly and Biogen on how getting pricing strategy right – or getting it wrong – can have significant consequences.
Key Topics explored
Above inflation price increases for products with little known clinical advantage are finding it difficult to gain market traction. Proving value is now essential.
It is almost certain that drug costs will be considered in ACO assessments going forward – will they be successful in controlling prices and what does pharma need to know about them.
The decentralised nature of US healthcare has created a plethora of unconnected electronic patient record formats. To what extent is this limiting Pharma’s access to large volumes of data tying medication use to outcomes to underpin their negotiating position?
Proving value can take many forms, but being able to show advantage over established first line therapies is a critical starting point – the need for comparator trials is now firmly established.
Discounting, risk sharing, patient support programmes, better evidence from real world data: are these enough to silence the critics?
The unfolding story about Gilead’s Solvaldi/Harvoni and J&J’s Viekra Pak demonstrates that high reward can be high risk, with product success in the market being short lived.
The report is informed through in-depth interviews with payers, advisors and clinicians. To ensure open and critical responses some contributors identities have been kept anonymous:
Leela Barham is an independent health economist and policy expert.
John J. Doyle is senior vice president, Advisory Services, and leads the Values & Outcomes efforts to navigate the transformational changes in the healthcare marketplace from volume to value, via a population health perspective.
Robert Howard is Professor of Old Age Psychiatry at UCL in London.
Leigh Purvis is the Director of Health Services Research in the American. Association of Retired Person’s (AARP’s) Public Policy Institute (PPI).
Alan Shaw is a consultant to the pharmaceutical industry from a financial perspective and former Chief Financial Officer of Serono S.A.
Anonymous: A leading oncologist who heads a cancer unit at an established cancer center in the US.
Anonymous: An anonymous medical director works at a US national plan covering nine million patients who is involved in policy, formulary management, quality improvement, readmissions, pay for performance activities and network management.
Anonymous: An Executive Chairman of a private biotech firm and former CEO of a larger biotech that is now part of a pharmaceutical company.
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